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Understanding Section 80GGC of the Income Tax Act

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Created on
May 17, 2023


What’s Inside

Section 80GGC comes under the wing of the Income Tax Act (1961). It allows taxpayers in India to claim tax deductions for their contributions to political parties. The government of India offers various provisions under various sections of the Act which provide tax benefits to taxpayers who contribute additional funds. By availing themselves of this provision, taxpayers can claim deductions on their taxable income. Taxpayers must know the details regarding Section 80GGC deductions to fully understand its benefits.

What is Section 80GGC?

Individual taxpayers in India may claim tax deductions for contributions made to political parties during the prior fiscal year under Section 80GGC of the Income Tax Act, 1961. It is crucial to remember that this clause does not provide tax deductions for contributions given in cash, by local governments, or by legal entities.

Taxpayers may deduct other expenditures, including medical expenses and home rent allowances, in addition to those covered under Section 80GGC. Taxonomies should know the different rules and sections of the Income Tax Act 1961 to maximise their tax savings and reduce taxable income. Taxpayers can significantly lower their tax payments and enhance their discretionary income by utilising the numerous tax deductions and exemptions provided under the Act.

Who is Eligible for Section 80GGC Deductions?

Individual taxpayers, Associations of Persons (AOPs), Hindu Undivided Families (HUFs), Body of Individuals (BOIs), and firms that are ineligible for government funds may claim deductions under 80GGC.

What are Section 80GGC Deduction Limits?

Section 80GGC limit of the Income Tax Act says that Indian taxpayers may deduct contributions to legally recognised political parties or electoral trusts. The deduction amount may equal 100% of the donation but not as exceed the contributor's entire income.

It is essential to remember that tax deductions under Section 80GGC are not available for contributions made in cash or in kind. This amendment was enacted in 2013-2014, with subsidies or donations made through legitimate banking channels. They include services such as Internet banking, credit cards, debit cards, cheques, demand drafts, etc., to be eligible for tax deductions.

When claiming the deduction while filing tax returns, taxpayers must provide sufficient documents to support the contribution made. Provide adequate documentation to ensure the authorities do not deny the tax deduction claim. As such, taxpayers should maintain sufficient records of donations made to political parties and electoral trusts to ensure a hassle-free process while claiming deductions under Section 80GGC.


Ultimately, Section 80GGC of the Income Tax Act of 1961 allows Indian taxpayers to claim tax deductions for contributions to registered political parties.

Understanding the different provisions and parts of the Income Tax Act is critical for taxpayers looking to maximise their tax savings and lower their tax burden. Proper planning and investing decisions may help people and businesses better manage their money and accomplish their financial objectives. Make sense of your personal finance instantly with Fi Money. You can open a zero-balance savings bank account. Next, get all your money questions answered by Ask Fi, an intuitive personal finance assistant. Regularly use the app, as it encourages you to build better monetary habits, meet all your money goals & reward you for making significant financial choices. Fi and its licensed banking partner help easily categorise your expenses to manage your money online.

Frequently Asked Questions 

What is Section 80GGC of income tax?

Section 80GGC of the Income Tax Act 1961 allows individual taxpayers in India to claim tax deductions for contributions made to political parties during the previous financial year. 

What is the limit for 80GGB and 80GGC?

As per the Section 80GGC limit and Section 80GGB within the Income Tax Act, taxpayers can claim a tax deduction for contributions to political parties up to 100% of the amount paid. However, The maximum deduction cannot exceed the taxpayer's taxable income.


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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